Trump administration pushing massive EPA changes

‘BIG LEAGUE' CHANGES COMING TO EPA: President Donald Trump’s administration is charging ahead with its plans to dramatically revamp the EPA. Today, the president will sign an executive order at 1:50 p.m. beginning the long and winding process of attempting to undo the controversial Waters of the U.S. rule. The order will instruct EPA and the Army Corps of Engineers to “review and reconsider the rule,” a senior White House official told reporters Monday night, at the same time ordering Attorney General Jeff Sessions to ask the court to put the court case on hold. It’s a review that “is going to take a long time to get through,” the official said, and don’t expectany more certainty in the meantime. “You’ll just have to do sort of a case-by-case assessment as permit issues arise.”

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But that’s not all: The Trump administration has bigger plans than just killing the Obama rule: it’s also taking on the legal interpretation on which the rule is premised. In the 2006 case Rapanos v. United States dealing with which wetlands are protected under the Clean Water Act, the Supreme Court reached a muddled 4-1-4 ruling, with the four conservative justices, led by Antonin Scalia, on one side, the four liberal justices on the other, and moderate Anthony Kennedy issuing his own concurring opinion that set an entirely separate test for when a water bodyshould be covered. Since then courts have largely held that Kennedy’s test, at least, must be met. But the Trump administration doesn’t buy that, and as part of the EO is asking the Army Corps and EPA “to consider thinking about Justice Scalia’s interpretation of navigable waters,” which is generally narrower, the senior White House official said.

A friendly reminder: Vowing to kill the water rule, like promises to undo EPA’s climate regulations, is easier said than done. Justices may not want to put the case on hold, especially since the Supreme Court has already agreed to take on a related question about which court has jurisdiction over challenges. And if the Trump administration moves to withdraw the Obama rule, it’ll have to go through the same rulemaking process that created it, including notice and comment periods, and will face all but certain legal challenges from environmental groups and sympathetic states.

Huge EPA budget, staffing cuts eyed: The executive order comes on the heels of a White House proposal — “far more severe than anyone imagined,” according to one source — that would see the agency’s budget slashed by a quarter and one in five of its workers eventually eliminated, Pro’s Alex Guillén reports. If enacted, sources said, EPA’s budget would drop from its current level of $8.1 billion to $6.1 billion, a level not seen since 1991, and one source said the agency’s 15,000-strong workforce would drop to 12,000, a level not seen since the mid-1980s. It’s unclear if congressional Republicans would go along with such dramatic reductions, but Democrats are already vowing staunch resistance and the final appropriations package will need some of their votes (more on that reaction below).

Meanwhile, the Capitol buzzes with anticipation of Trump’s speech to a joint session tonight. Expect the president to tout the two Congressional Review Act resolutions he signed to wipe away Obama-era energy regulations, as well as his efforts to revamp the regulatory process through executive orders. ME isn’t holding its breath for specific additional details on an energy agenda, though we may get more details on additional steps to slash regulations. Advocates, including Food & Water Watch, National Nurses United, the Hip Hop Caucus and (long-time Trump foe) Rosie O’Donnell, will gather in front of the White House at 6:00 p.m. ahead of the speech to highlight their opposition to his agenda.

Before the speech: House lawmakers today take up the SCRUB Act (H.R. 998), which would create a five-year commission to identify federal regulations that could be rescinded. It would focus on older regulations and aim to reduce overall regulatory costs by 15 percent.

WELCOME TO TUESDAY! How is it already the end of February? I'm your host Anthony Adragna, and Daniel J. Weiss was first to identify Hugo Black as the most recent sitting senator picked for the Supreme Court. For today: Who was the last pro athlete to serve in Congress? Send your tips, energy gossip and comments to aadragna@politico.com, or follow us on Twitter @AnthonyAdragna, @Morning_Energy, and @POLITICOPro.

MAJOR CHANGE COMING TO RFS: Trump’s administration plans to issue an executive order changing the Renewable Fuel Standard so that oil refiners would no longer be responsible for meeting the EPA biofuels mandates, leaving that job instead to gasoline wholesalers who supply fuel to retail outlets, Bob Dinneen, CEO of the Renewable Fuels Association, tells Pro’s Eric Wolff. That move is likely to be worth hundreds of millions of dollars to CVR Energy, a company owned by Trump regulation czar Carl Icahn.

POET, the world’s largest biofuel producer, blasted the “bailout” and “back-room deal” in a statement. "Bob Dinneen does not have the authority to negotiate on behalf of the biofuels industry, and Icahn does not have the authority to negotiate policy on behalf of the U.S. government,” POET CEO Jeff Broin said in a statement.

ZINKE POISED FOR CONFIRMATION: It’s now only a matter of time — and how much of it Senate Democrats want to burn — before Rep. Ryan Zinke takes the reins of the Interior Department, Pro’s Esther Whieldon reports. The Montana Republican easily cleared a procedural hurdle on Monday night by a 67 to 31 vote. Sixteen members of the Democratic caucus supported cloture on the nomination, while Sen. Ron Wyden voted present over what he said were unanswered questions about Oregon forestry: “So far, it has proven impossible to get even a twig of information about his intentions for Oregon’s O&C forests,” he said in a statement. “Oregonians deserve to have this information before a final vote.”

SENIOR DEMOCRATS SLAM POTENTIAL EPA CUTS: Senior Senate Democrats slammed the Trump administration's plans for drastic EPA cuts and warned the president will ultimately need some Democratic appropriations votes. “I hope that he thinks about that when he establishes his priorities,” Dick Durbin, the No. 2 Democrat, told reporters. “Many of the things which he’s pushing for now are not going to win a lot of Democratic support.” Top EPW Democrat Tom Carper called the threatened cuts “appalling” and said they would imperil public health. “Reckless cuts to the EPA — the agency responsible for protecting public health and our environment — are not what Americans voted for in November,” he said in a statement.

GOP unsure too: Congressional Republicans expressed skepticism Monday about building up the military on the back of deep cuts to domestic programs, POLITICO’s Rachael Bade, Sarah Ferris and Shane Goldmacher report. “The president will propose and the Congress will dispose,” House Appropriator Charlie Dent (R-Pa.) said. “We’ll look at his budget but at the end of the day we in Congress write the appropriations bills, and I am not one who thinks you can pay for an increase in [military] spending on the backs of domestic discretionary programs, which constitute 13 or 14 percent of all federal spending.”

Barrasso backs fundamental changes: EPW Chairman John Barrasso declined to comment on the initial guidance but said he supported “fundamentally” changing the EPA’s direction. “The EPA has really lost its way over the last eight years,” the Wyoming Republican told ME. “We need to fundamentally change the direction of the EPA to get it back basically focused on the laws that passed Congress, not on what it chooses to do with a mind of its own.” He declined to say whether he would support drastically cutting the agency’s climate change work until he reviewed Trump’s proposal.

Blame it on the Democrats: Any delay in getting White House energy policy efforts up and running stems from staunch Democratic opposition to even the most non-controversial Cabinet nominations, Barrasso said. “Needless obstruction is causing difficulty in getting things done from the standpoint of energy policy,” he told ME. “It’s deliberate and obstructive and I think it’s not helping the country move forward.” But he also described Trump’s actions in his first month in office as “pretty terrific,” citing executive orders aimed at overhauling the regulatory process and getting two energy-related CRAs signed into law.

MORE PRESSURE AGAINST BLM METHANE CRA: More than 60 local officials from Colorado, Utah, New Mexico, Nevada and the Ute Tribe are urging senators in a letter today not to vote on a Congressional Review Act challenge to a BLM rule targeting methane emissions from oil and gas operations on public lands. “We urge your opposition to using the Congressional Review Act to eliminate BLM’s rule to reduce natural gas waste because of the rule’s benefit to our local governments, constituents, and taxpayers,” they wrote.

But senior Senate Republicans remain committed to voting on the CRA challenge, even though some undecided GOP senators complicate its path to passage. “I’m committed to getting that passed,” Barrasso told ME. Regardless, it appears Cabinet nominations will consume the Senate’s time this week, so any consideration of the CRA will wait.

PRUITT EMAIL QUESTIONS NOT GOING AWAY: Revelations that EPA Administrator Scott Pruitt used a private email account while serving as Oklahoma attorney general — in direct contradiction to his Senate testimony — are “only the beginning of the mess of conflicts and falsehoods,” Sen. Sheldon Whitehouse told ME in a statement. “Lo and behold, the documents Scott Pruitt wanted to keep hidden have confirmed our suspicion that he used his personal email address to conduct official state business and that he was not honest with the Senate about this during his confirmation process,” the Rhode Island Democrat said. “Senate Republicans had every opportunity to prevent this mess. Instead, they rammed this nomination through, and it looks like they did it, not despite him being the polluters' tool, but because he is the polluters' tool.”

Listening sessions roll on: Add another governor — Mississippi’s Phil Bryant — to the list of state executives Pruitt has met with since assuming office little more than a week ago. That brings the total to 19 governors, according to EPA, which Pruitt tweeted is a “good 1st step to restoring cooperative federalism.”

SOCIAL COST OF CARBON UNDER THE SPOTLIGHT: Two House Science subcommittees today plan to “examine the methods and parameters used to establish the social cost of carbon” and look at “how the process can be improved.” Chairman Lamar Smith is decidedly not a fan of the metric used to measure costs imposed on society by each metric ton of greenhouse gas pollution, warning in his priorities for this Congress that it was used by the Obama administration to “push a costly climate agenda with little transparency or accessibility.” Witnesses include the University of Chicago’s Michael Greenstone, who helped implement the figure during the Obama presidency; the Brookings Institution’s Ted Gayer; the Heritage Foundation’s Kevin Dayaratna and the Cato Institute’s Patrick Michaels. It kicks off at 10:00 a.m. in Rayburn 2318.

WHAT’S UP IN INTERNATIONAL CLIMATE ACTION? UNFCCC Executive Secretary Patricia Espinosa delivers her first remarks in the U.S. since the start of the Trump administration today. Expect discussion to touch on how the international community is adjusting to the new U.S. president. It kicks off at 1:00 p.m. at the Copley Formal Lounge at Georgetown University (3700 O St NW).

NOT BORDERLINE: Alberta Premier Rachel Notley warned Monday a border adjustment tax that hurts the flow of crude from the oil-rich province would negatively impact both the U.S. and Canada, Pro’s Ben Lefebvre reports. Notley said Canadian energy executives “asked for us to make the case to as many people as possible on the economic effects of Albertan oil.”

MAIL CALL! TIME TO SAVE THE WHALES: The Center for Biological Diversity sent a letter Monday to Pruitt urging the agency to prosecute Hilcorp Alaska for Clean Air Act and Clean Water Act violations related to an ongoing natural gas pipeline leak in Alaska’s Cook Inlet or face a lawsuit. “Every day they delay, wildlife is harmed, boaters are at risk, and a potent greenhouse gas rises into the atmosphere,” Miyoko Sakashita, the group’s oceans program director, said in a statement.

BANKS, CATANZARO FORMALLY ANNOUNCED: Pros learned last week they had begun work, but the White House formally announced George David Banks and Michael Catanzaro as presidential aides on Monday. Banks, previously executive vice president of the American Council for Capital Formation, will serve as special assistant for international energy and environment, while Catanzaro, most recently a partner at the CGCN Group, will be special assistant for domestic energy and environmental policy.

John Holdren, former President Barack Obama’s top science adviser, has rejoined the Woods Hole Research Center as senior adviser to its president. “The Center’s work on the causes, dynamics, and consequences of climate change and on the actions needed to reduce its damages has never been more important,” Holdren said in a statement.

About The Author

Anthony Adragna is an energy reporter and author of Morning Energy. Before joining POLITICO, he spent four and a half years covering EPA and other environmental issues with Bloomberg BNA. His journalism career started across the country as a reporter with Seattle Business Magazine.

Adragna is a Washington, D.C. native and a graduate of Middlebury College in Vermont. When he’s not reading EPA regulations or covering floor votes, he enjoys cooking and rooting for the Washington Nationals.